The proposed bill establishes the "Decarbonization Demonstration Initiative Act of 2026," which aims to facilitate the transition of large multi-unit residential buildings to geothermal heat pump systems as a means to reduce greenhouse gas emissions. The initiative will create a multi-unit residential geothermal feasibility loan program, administered by the Rhode Island office of energy resources in coordination with the Rhode Island infrastructure bank. This program will provide no-interest loans to eligible applicants for the sole purpose of obtaining detailed feasibility proposals that assess the technical and economic viability of converting existing buildings to geothermal systems.

To qualify for the loans, applicants must own or control a multi-unit residential dwelling containing greater than 65,000 square feet of gross floor area and submit an initial feasibility screening prepared by a qualified contractor indicating potential suitability for geothermal conversion. The bill outlines the loan amounts, which shall not exceed $50,000 per building, but may be increased to $75,000 for buildings exceeding 100,000 square feet. Repayment of the loan is not required if the feasibility proposal determines that geothermal conversion is not feasible or if the applicant elects not to proceed due to factors beyond their reasonable control.

Additionally, the bill mandates the office to submit an annual report to the governor, the speaker of the house of representatives, and the president of the senate, detailing the number of applications received and approved, the total amount of loans issued, feasibility outcomes, estimated energy savings, and recommendations for the program's continuation or modification. The general assembly is also tasked with considering annual appropriations of up to $500,000 to support the implementation of this chapter, with funds being used solely for feasibility loans, administrative costs, and program evaluation. Any unexpended funds at the end of a fiscal year will remain available for future expenditures, and repaid funds will be re-lent to new applicants under the same terms.